FARM RECORDS AND ACCOUNTSCONTENT
- Farm Records
- Meaning of Farm Records
- Importance of Farm Records
- Types of Farm Records
- Farm Accounts
- Definition of Farm Account
- Importance of Farm Accounts
- Types of Farm Accounts
- Definition of Some Accounting Terms
- Methods of Calculating Depreciation and Salvage Value
- Formula for Calculating Depreciation
Meaning of Farm RecordsFarm records refer to the documentation of all the various activities on the farm. It shows the major activities and transactions that take place in a farm enterprise over a period of time.
Importance of Farm RecordsA farm record keeping is advantageous in the following ways:
- Farm records give the history of what has happened on the farm for the periods during which they are kept.
- It allows the manager to carry out performance evaluation of the farm business.
- It helps in determining the profitability of the business.
- It is an indispensable tool for the farm manager during planning and budgeting.
- It allows the manager to determine the efficiency levels of inputs used in the production.
- It is a vital requirement when seeking loans from banks.
- It enable both the government and managers to determine the amount of money payable by the farm business.
- It enables the manager to make or take sound management decisions about the farm.
- It is useful for insurance purposes.
- It gives room for comparism with the same farm enterprises in the same areas.
- Proper farm records assist the government at various levels when planning national agricultural and economic development programmes.
- It determines the farmers management skills.
- It gives an actual value of the farm in case of winding up.
- It also gives the actual farm yields.
Types of Farm RecordsA good farm or farm manager keeps many important records which include the following:
- Inventory records
- Farm dairy
- Production/yield record
- Income and expenditure record
- Inputs records
- Labour records
- Sales records
- Purchases records
- Supplementary records
- Consumption record
Farm Inventory RecordFarm inventory record is a written document containing the list of all items in the farm at a particular time. It is the complete account and evaluation of all assets and liabilities on the farm at a specified date. It shows the state of each equipment and its value.It is usually ten at beginning and at the end of each year. Below is an example of inventory record.
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